As I noted many times before, I figured that this would serve as nothing but a free invitation for the whales to simply short the protocol into the ground. And for the most part, that’s what’s happened to the price:

Price has depreciated by -21.92% since the addition of Mex futures.

In that same time span, the crypto market capitalization has actually increased and so has Bitcoin.

So, $TRX’s move downward was actually fairly independent of the markets as a whole. Which further bolster my theory that the Mex addition essentially messed things up for $TRX bulls.

Here’s a more thorough article I wrote on it because I used $ADA as a prior example of how Mex can lead to projects being shorted to oblivion (and all the ones lower than $LTC on a market capitalization level essentially have been at this point.

So Why Did the Price Raise?

Not a huge fan of GlobalCoinReport, but it gives the pertinent details for this (which are hardly any other than Justin Sun claiming that he had something ‘special’).

I’m not sure that a partnership is going to really move the needle on this project to be entirely honest.

This announcement came out on June 9th, so I’m not sure if it triggered the recent ‘break’ in the downtrend resistance from late May that was broken on the 12th, but its still something that’s worth noting.

Conclusion

[Disclaimer: The following is not financial advice neither was anything written above or ever written about $TRX by this author; The author is not a financial adviser. These are just theories/ideas. Follow at your own peril]

Thoughts

Based on what I’m seeing on the lower TF charts, it appears as though some bearish momentum is beginning to take hold of $TRX once again.

I feel fairly confident that the whales on Mex that have been shorting this thing to oblivion are going to continue to help me out.

I also do not think that Justin Sun’s announcement will be enough to seriously help $TRX because mundane fundamental news has not been a mover of markets in the last few weeks/months in this bear market.

So, my primary thought would be that a short is a good position on this coin.

However, there is the chance that the localized uptrend that is taking place since July 12th may just continue itself after a brief period of consolidation.

In either case, it seems as though a move downward is a bit more likely than a move upward (price-wise).

So, Here’s What My Strategy Would Be

I’d go to Mex and take a short out on $TRX.

My goal on that short would be to catch that move back downward to 500 sats (hopefully):

That would represent a 7%+ gain.

However, there could be that move upward to $600 that I noted.

So, I’d also open a long position on Binance or some other exchange as well.

Since I favor the short > long outcome, my S/L on both exchanges would be profoundly.

Managing the Short Trade

The ultimate goal is hitting 500 sats (give or take), as stated earlier.

So, I’d enter now at 549 sats and set a S/L at 565 sats. That’s less than 3% potential loss.

The R/R analysis on the short would look like this:

If my S/L on the short trade gets hit, I’d just take those funds, send them to Binance, and then cover w a long from that point.

Long Buy Strategy for $TRX

I’d simultaneously place a long on $TRX at the same entry price.

My S/L however, in this situation would be 530 sats.

Similar to the short strategy that will be running simultaneous, if I’m wrong in my prediction, then I use the funds that were stopped out of the trade and transfer them to Mex to purchase additional short contracts for $TRX.

Below, is what the R/R reward of this move/decision:

Explaining Why This Strategy Works

The strategy that I just outlined is actually designed to ensure victory no matter what the outcome of this trade is (like I said before, hedging is the key to victory).

So, let’s imagine a scenario in where I have $20k to invest in $TRX. I’m not entirely sure which direction it may go, so I have $10k going long and $10k going short.

Let’s Say the Long Trade (Outcome) is What Happens

My short ($100) gets stopped out at 565 sats, which is a loss of -$291 (let’s round it to $300 for slippage + fees from Mex).

I’d take the remaining $9.7k and place it into the long trade at 565 sats.

I stick with my long strategy and then I pull out everything at 600 sats.

Here’s how the profit breakdown would work:

My original entry on the long ($10k) would have appreciated by 9.28%, so that’s +$928 profit there.

I’m -$300 on my original short trade that I have.

I took the remaining $9.7k and threw that in on $TRX at 565 sats. It appreciated +6.19% from that point.

That left me with a total of +$600 from the remaining funds from my short that I was S/L’d, which I then used for a long trade on $TRX on Binance or something. This amounts to a net profit of $300 on the money that was originally apportioned to that short trade (so, I’m left with $10.3k).

If you tally up the spoils here, you get $10.3k+$10.9k, which = $21.2k.

That’s a 6%+ ($1,200) profit that’s all but guaranteed with an appropriate hedging strategy.

That’s why my rule = Always Hedge

That’s what smart traders do.

Disclaimer: I do not own $TRX. Nothing in this article is financial advice and I am not a financial adviser. I was not paid to write or distribute this material either.

Thank you!

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